I wonder why I was under the illusion that, once the economic crisis was over, once those industries too weak to survive were dead and buried, we would have witnessed a sort of “industrial rebirth”, the rebirth of an industry capable of dominating the future. An industry more marginal in the building of wealth, but intrinsically strong, dynamic, in one word: new!
Alessandro Mazzeranghi
Instead, what I’m seeing often are disoriented survivors that think like they did back in 2000, or dazed to the point that they do not think at all, or even worse, brainless. By “brainless industries”, I mean those no longer governed by an industrial logic, but that now operate pursuant to financial logics imposed by their true bosses: banks. It is sad to think that those most responsible for the crisis that took hold of us starting in 2008 are those that actually overcame it better; they came out of it trampling on the ruins of that part of the tired, disheartened world that up until then was actively producing. We wander through these ruins like our European grandfathers wandered through the industrial ruins of WWII. And they were able to tenaciously give rise to the miracle of reconstruction throughout Europe. Still today, around the castle of Nuremberg, we can see the photographs of the destroyed city (it was 1945), and admire the city of today. Every country – winners and vanquished – rebuilt with determination and strong commitment.
HOW CAN WE EUROPEANS COME OUT OF THE WAR CALLED CRISIS? Let’s suppose that the crisis is over and hence a slow reprise is beginning. But if we look around us we see nothing particularly comforting. Perhaps this is my personal pessimistic vision? I don’t think so. The weak spot is evident: during the crisis, companies – after a long moment of disorientation – adopted a “liquid” strategy of continuous adaptation and re-adaptation to the changing and changeable conditions of the context, aiming for very short-term survival at the start, and medium-term later. All this is understandable if we consider the absolute uncertainty of the context, especially in Europe where different reasons of unease piled up in the course of time, confusing the ideas of those involved in the field even more. All told, it was often a brave but near-sighted policy that can be summarized in the Latin proverb mors tua vita mea. Or if you prefer: everybody against everybody else. Without an idea for industrial development on a much wider scale. The result is that many companies have survived – often at the expense of sacrifices by all those involved – but they have no clear plan for the future. If we can actually speak of a true industrial future for Europe is something we will see in the course of time.
SOME PECULIARITIES ABOUT TISSUE. The case of tissue has two additional particularities, totally independent of each other. The first is common to many other fields: we are speaking of consumables where, at least as far as the finished product is concerned, transport costs greatly affect overall cost. So it is clear that converting must preferably take place near the final customer, and hence the European market must per force be supplied by facilities situated in the same geographical area. Next issue: European tissue entered the crisis while already in a condition of over-production; this had a further multiplicative effect on the consequences of a reduction in consumption, or of the shifting of customers towards lower-tier products (with clear damage for premium products).
THE RULES OF THE MARKET. All this took place in a (European) market condition close to perfect competition, where even if the local or national community wanted to help a company in difficulty, the restrictions would have been insurmountable (except in extreme cases). The entire European industry, then, after having attained an ideal condition of competitiveness, totally suitable in a moderate but continuous development prospect, experienced an unexpected recession due to exogenous factors, external to the industrial world. The rules of the game were no longer the correct ones, competitive development regulated for the good of the consumer and of society as a whole became the opposite – a sort of jungle where the best one can hope for is to survive with difficulty; there are those who succumb, there are those who survive but no one betters or grows.
DEVELOPMENTS COMPANIES PREFER. Those who do not adapt to change, perish: it is a Darwinian concept fully valid also in the world of industry. Companies are very similar to living organisms; they can contract diseases in some of their departments or functions, they have an imperfect understanding of reality, they have a sort of self-conscience. And they want to survive, hence, they want to adapt to the surrounding environment. So, following an initial period of understandable bewilderment, excluding those inflexible companies for which the crisis was like a rigid winter for an elderly, debilitated person – their ultimate cause of death – companies reacted; by doing what? Reducing costs! This is what the different cost cuts were targeted to (of course), as were investments in new plants, in production and technology. So companies invested, they modernized themselves but with a view towards survival instead of development. With very satisfying results compared to the goals, I would say.
WHAT FUTURE? Unfortunately we are not alone. Europe is one of the two industrial world centers, together with its North American “partner” with whom it “fought” its commercial battles always based on common (social and industrial) foundations. We are inside a globalized context where commercial rules are arbitrary. And we do not share a common commercial policy – on the contrary, in the tissue scenario there exists a condition of reciprocal suspicion that shatters rather than divides. So each will continue along the chosen road, rejoicing in the troubles of his competitors, without seeing the troubles inherent in the field. In the meantime, small converters are disappearing as active companies and are becoming – in the best-case scenario – contract manufacturers (hence stifled by the competition). A string of acquisitions and reorganizations followed. But what about research and innovation? Not technological research (how to manufacture an existing product at lower costs, with less waste, with fewer environmental impacts), but product innovation? I’m not seeing too much activity. If the crisis will really pass, we Europeans will begin asking for higher performing, more beautiful products; new products. And we will once again be moderately interested in spending more to bring them home. In other fields of the world of consumer goods, this is already happening: consumers are returning to the premium segment. Since we are proceeding in random order, I dare say that those who embarked on the road to innovation will acquire reliable and profitable markets, those who did not will slide even further back.
THE CONFUSION WITH THE ENVIRONMENT (OR WITH “GREEN”). I’d like to speak about this issue in order to clarify that product innovation is NOT, in my opinion, innovation that enhances the product’s environmental sustainability. Respect for the environment, at the levels set forth by the European Union, is an obligation with already rather stringent parameters; it is a decisive factor in relationships with the local communities hosting the factories. It can be a decisive factor for the survival of a facility, but it is not an issue of competition on supermarket shelves. Ask buyers if they know what the Ecolabel or some other label or acronym found on a packet of tissues means! So improving a company’s environmental factors is an optimal, sometimes indispensable thing (it depends on the starting point), but it is to be intended as part of the survival strategy adopted to overcome the crisis. Surely there are things to be completed, performances to be further improved, but this is not where the future is being staged.
CONCLUSION. The future is staged on two simple questions: the questions that the consumer in front of the supermarket shelf asks himself: • What practical advantage do I get from buying a tissue paper product (instead of another type of product)? • Does the cost/practical benefit ratio satisfy my needs? There is a third question, cached, but just as important: • Does the product create an aesthetic gratification or a social recognition? I’d say that we need to return to the bases, and from there, design the progress for the next five years, hoping that in the meantime, another cataclysm doesn’t overwhelm us. *